February 7, 2016

Fraud investigation continues at Cedar Falls financial firm

The fallout continues in Cedar Falls the day after it was revealed that a local financial firm had been under investigation for potentially fraudulent accounting practices. The National Futures Association filed an enforcement action against Peregrine Financial Group, also known as PFG Best, Monday afternoon.

The futures association said that PFG claimed it had $225-million in a bank account, but a review showed only five million dollars on deposit. Now, the U.S. Commodity Futures Trading Commission has also filed a complaint against the company and its founder, Russell Wasendorf, Senior.

The Commission is accusing PFG. and Wasendorf of misappropriating customer funds, violating fund segregation laws, and lying on financial statements filed with the Commission. The CFTC filed the complaint in federal court in Illinois today (Tuesday), and is also seeking a restraining order to freeze PFG’s assets and preserve the company’s records. In addition, a Cedar Falls restaurant owned by Wasendorf has apparently closed.

A sign posted on the front door of MyVerona restaurant and deli in downtown Cedar Falls read “closed until further notice” during the lunch hour today. Wasendorf opened MyVerona after he moved PFG’s headquarters to Cedar Falls in 2009. He had announced plans to open a second location in the proposed TechWorks facility in Waterloo, but those plans are now in question.

Wasendorf was taken to University Hospitals in Iowa City on Monday after apparently trying to take his own life. Hospital officials would not release any information about his condition this afternoon.

By Jess Gavin, KCNZ, Cedar Falls

Print pagePDF pageEmail page